USPTO Guidance on Alice v. CLS – Software Still Patentable

Earlier today the Deputy Commissioner for Patent Examination Policy, Andrew Hirshfeld, sent a memorandum to the patent examining corps with the preliminary examination instructions in view of the Supreme Court’s recent decision in Alice Corp. v. CLS Bank International.

At least initially, the USPTO instructions to examiners seems extremely patentee friendly, which I must say comes as a surprise given the largely anti-patent rhetoric that has come from the White House over the last 16 months. Indeed, the USPTO has told examiners that the reason Alice’s claims were determined to be patent ineligible was because “the generically-recited computers in the claims add nothing of substance to the underlying abstract idea.”

The USPTO then went on to point out to patent examiners that there is no new category of innovation that is patent ineligible, nor is there any new or special requirements for the eligibility of either software or business methods. Hirshfeld explained: “Notably, Alice Corp. neither creates a per se excluded category of subject matter, such as software or business methods, nor imposes any special requirements for eligibility of software or business methods.”

Hirshfeld also explained that there is now a slight change in the way applications are to be examined when claims involve abstract ideas. Essentially, Alice stands for the proposition that the same analysis should be used for all types of judicial exceptions and the same analysis should be used for all categories of invention. Still, even recognizing this shift in analysis, Hirshfeld told examiners: “[T]he basic inquiries to determine subject matter eligibility remain the same as explained in MPEP 2106(I).” (emphasis added). Therefore, nothing has changed as far as the USPTO is concerned.

While most patent examiners can be expected to implement the desired USPTO interpretation, a significant question remains with respect to how the Patent Trial and Appeal Board (PTAB) will interpret the Supreme Court’s decision in Alice. The PTAB as a quasi-judicial body is not bound by the interpretations of the agency, and as a body the PTAB has been invalidating claims at an alarming rate in post-grant proceedings newly available as the result of the America Inventors Act (AIA). Further still, there is no telling how the district courts will interpret the decision in Alice, but for the time being the USPTO does seem to be moderating the decision. A significant question also remains regarding whether all patent examiners in all Art Units will follow this guidance. Over the years certain examiners have proudly proclaimed to patent attorneys that they do not follow the instructions given by agency leadership and will only issue patents if ordered to do so by the Board, a fact that seems to be corroborated to some extent by extremely low allowance rates in certain Art Units. Recalcitrant examiners will likely still be a problem, as they have always been, but they should hopefully be a minority.

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The Analytical Framework

According to the USPTO guidance for patent examiners, they should implement a two-part analysis for abstract ideas, which was set forth in Mayo v. Prometheus. First, examiners must “determine whether the claim is directed to an abstract idea. Second, if an abstract idea is present examiners must determine whether any element, or combination of elements, in the claim is sufficient to ensure that the claim amounts to significantly more than the abstract idea itself.” (emphasis in the original).

In terms of what is an abstract idea, no definition is provided, which will continue to be the achilles heel of the Supreme Court’s “doctrine,” and which will all but guarantee a subject interpretation prevails. Notwithstanding, the USPTO explained bract ideas include fundamental economic practices, some methods of organizing human activities, an idea itself and mathematical relationships and formulas. While I commend that USPTO for a thoughtful interpretation of the Alice decision I can’t help but comment that an abstract idea is in part defined as an idea, which isn’t the USPTO’s fault, but this circular definition is the type of thing we must deal with given the Supreme Court’s refusal to provide a coherent, thoughtful and certain test.

In terms of what constitutes a sufficient limitation to render a claim drawn to an abstract idea (whatever that is) to be still nevertheless patent eligible, the USPTO explains that the following “may be enough to qualify as ‘significantly more’ when recited in a claim with an abstract idea”: improvements to technology or technical field, improvements to the functioning of a computer itself, limitations that link the abstract idea to a particular technical environment. The USPTO specifically identified that “apply it” or similar words would not be considered to be limiting enough. Similarly, it is insufficient when a claim merely recites “no more than a generic computer to perform generic computer functions that are well-understood, routine and conventional activities previously known to the industry.”

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Conclusion

It seems clear based on the two-part analytical framework explained by the USPTO that at least some claims that cover “abstract ideas” will remain patent eligible. I’m not sure whether this is what the Supreme Court had in mind, and such an interpretation will only further muddle whatever the “abstract idea doctrine” really is.

Essentially, the USPTO is interpreting the Supreme Court decision to say that even if a claim covers an abstract idea it can still be patent eligible if the claim itself is sufficiently limited so that the claim covers “significantly more” than the abstract idea itself. That being the case, nothing changes.  Under the previous test if there were limitations within the claim there was no abstract idea. Saying that limitations within the claim makes a claim to an abstract idea a patent eligible abstract idea is analytically no different than saying a limitation that tethers the claim to a specific machine implementation or environment is patent eligible because it is not an abstract idea.

Of course, it will be essential to avoid general purpose computers. The Supreme Court phobia of general purpose computers likely means the fact that your software is operable across platforms means that the software is patent ineligible; a truly ironic and moronic result.

This initial guidance to examiners seems particularly helpful to patent applicants seeking patents in the software and business method space. The USPTO seems poised to narrowly interpret the Supreme Court decision, and has given applicants a roadmap on what to include in patent applications and what to argue. Of course, examiner cooperation and attention to this guidance will be uncertain until we see how examiners engage with applicants.